In many parts of northeast Asia and Europe train travel in the 21st century is a safe and fast cross-country mode of transport. In South and Southeast Asia, riding the rails is frequently frustrating and sometimes dangerous with derailments and fiery crashes.

China and India and Southeast Asia compromise the most populous region in the world, creating a huge potential market for modern and safe railways.

European, Canadian and South Korean manufacturers are vying for Asia’s new high-speed rail projects, but the competition is primarily between the Japanese and the upstart Chinese.

Japan had a decades-long head start, rolling out the first Shinkansen (bullet train) passenger service in 1964.

The Chinese, who sped onto the fast track in 2007, now can boast of having more than half of the world's 23,000 kilometers of high-speed rail track. They are reported to be in talks with 15 countries to sell their rail technology.
China's first super fast trains relied on foreign technology transfers, including from Mitsubishi Electric and Kawasaki Heavy Industries of Japan.

The latter joint venture "produced a system that has now been effectively copied by the Chinese, adapted it in part just as the Chinese have subsumed or embraced the technologies of the Europeans and others," says Richard Lawless, the chairman of the nascent Texas Central Railroad project, which has Japanese backing.

China has redesigned major components and now promotes its own rolling stock with maximum operating speeds up to 380 kilometers per hour.

Huge market for high speed rail

There are many prospective and lucrative customers in Asia.

A Malaysia-Singapore high-speed line would run for 400 kilometers. It has been under discussion for nearly a decade but in the meantime the proposed budget has skyrocketed.

Vietnam's national assembly derailed a high-speed project in 2010. But last month Prime Minister Nguyen Tan Dang signaled approval for a modern north-south line for trains traveling at speeds up to 200 kilometers per hour by 2030 and a final phase completed by 2050 for speeds up to 350 kph.

Indonesia and China on Wednesday signed a memorandum of understanding for a high-speed rail link between Jakarta and Bandung that, according to local media, will cost $6.7 billion to construct. No new railway line has been built in Indonesia since the end of Dutch colonial rule nearly 70 years ago.

Impoverished Cambodia has contracted with the China Railway group for a 400 kilometer link between a steel facility in northern Preah Vihear province to a proposed port on southern Koh Kong that is expected to cost around $10 billion.

In India, where high-speed rail has been envisioned since the 1980's, no train in commercial service yet exceeds 150 kilometer per hour.

Under Prime Minister Narendra Modi, who enjoys closer ties to Tokyo than Beijing, Japan seems to have the edge with a joint Indian-Japanese feasibility report scheduled for release in July. Construction is envisioned to begin in 2017 for the Mumbai-Amedabad route, costing between $11.3 billion and $12.9 billion.

No price tag has been revealed for what would be one of the more preposterous proposals: a Nepal-China rail link that, according to the China Daily newspaper, would tunnel under Mt. Everest.

Chinese financing key to deals

One of the China-linked projects most likely to get rolling is in Thailand, where serious negotiations have been underway. Proponents in Thailand note that the kingdom expends a third of its energy on transportation, but less than five percent goes to the most efficient mode: rail.

The Chinese face competition in Thailand with highly-regarded Japanese rolling stock, as well as the more utilitarian but noisier European trains, which are considered easier to maintain than Japanese-built trains.

Thailand is planning two lines of high speed trains - the one being fast-tracked for development would roll 350 km from Thailand’s northeastern to the eastern region, near the Lao border.

Beijing and Bangkok “are now thrashing out details regarding their collaboration” in constructing the standard-gauge railway, according to China’s state-run Xinhua news agency.

“It's very, very likely to get built by China, that route would be linking Thailand, Laos and Kunming,” spanning 1,200 km from inside China to the Gulf of Thailand, predicts Assistant Professor Wichai Siwakosit at Bangkok's Kasetsart University. “The loan would be coming from China...It would cost us a lot but we need to pay it back and the tax money would get into the equation.”

The loan terms for building the network is a key part of the equation in Thailand and elsewhere in Asia. And China’s financing terms have figured prominently in negotiations.

“If you come with the funding and it comes with the loan, then there's a really, really high chance that your system will get built here,” says Wichai.
China's recent rollout of the Asia Infrastructure Investment Bank will "in many cases allow them to make penetrations with the lending from those institutions that they otherwise could not do," predicts Lawless.

In Thailand, rail builder shapes industry, future investment

Despite the Chinese funding advantage, another Thai route is likely to be awarded to Japanese companies. It would run between Bangkok and the eastern part of Thailand, as part of an envisioned rail network to link with three other countries: Myanmar, Cambodia and Vietnam.

“Do we really need it? Those two routes?" questions Wichai, the rail engineering program coordinator of KURAIL at Kasetsart. "We as Thai people might not need it. There are some other things that influence those two routes.”

The main beneficiary for the northeastern Thai route would be freight operators in China, who would get a new, desirable route to the sea.

The Japanese operate many factories on industrial estates in eastern Thailand.

As Thailand’s economy has slowed since last year’s military coup, the country is under pressure to attract more foreign direct investment and maintain the loyalty of existing investors. Those investors could relocate their factories elsewhere, such as Vietnam, if Thailand's logistics infrastructure begins to lag its neighbors.

The Chinese and Japanese are also in the competition for proposed high-speed rail projects in the United States, most prominently in the two largest states -- California and Texas.

Backers in both states are weighing whether the balance should tip in favor of either China or Japan for technology and funding.

"I think on the technology, operational experience, safety side certainly it’s the Japanese. They have really an unprecedented record of operational performance and safety,” says Lawless of the Texas project.

"On the financial side, which is a critical issue, I understand, probably the Chinese would be seen to be legitimately much more aggressive, much more comprehensive in what they’re willing to do, and for that reason are making a lot of headway in a lot of countries," he says.

Another challenge the Chinese face in Asia and America is convincing buyers they can offer a reliable single integrated system even if the price tag is cheaper.

"If they adopt one country’s rolling stock system, for example, another country’s infrastructure system, and yet a third country’s control system or signaling system you have to make sure that these are integrated into a proven, single integrated system," explains Lawless. "That’s been a real challenge for the Chinese, particularly when they take foreign systems, overlay them with Chinese fixes or 'improvements' if you will, and then attempt to make that back into an entire system."

China’s rail industry looks overseas to keep momentum

China appears compelled to export its technology, after years of fast-paced rail growth created huge construction industries based around high-speed trains.

"The Chinese market is exhausting itself with the build out that they’re currently undertaking," adds Lawless. "They have to go overseas."

Japan, faced with a declining population and China’s economic ascendance, is trying to stay in motion. It is the only country, so far, to have commercialized magnetic levitation rail technology, that this month set a new world speed record with a train that topped 600 kilometers an hour.

Central Japan Railways intends to put the maglev train into commercial passenger service between Tokyo and Nagoya in 2027.

An American billionaire entrepreneur, Elon Musk, has announced plans to leap beyond both the Chinese and Japanese maglevs with a test track for the "Hyperloop" -- containing pressurized capsules to shoot passengers to their destination at a top speed of 1,220 kph.

That is unimaginable to those lumbering at an average speed of 40 kilometer per hour on India's Howrah-Amritsar Express, taking 37 hours to traverse the 1,600 kilometers between West Bengal and Punjab. But at least they can enjoy the view, something that will not be witnessed from the windowless Hyperloop where the scenery would pass by in a flash.